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Contractors warned to be vigilant over HMRC tax probes
Posted Aug 23, 2010
The PCG has warned contractors to continue being vigilant over IR35 as HMRC appears to be adopting a more devious approach to tax enquiries.
The contractors' group says that its tax advisers have seen more of a 'softly softly' approach from HMRC towards some of its members. Typically, HMRC would initial send a letter or make a phone call, rather than issuing a formal notice of dispute when looking into a contractor's tax affairs.
The PCG says that this method could lull contractors into a false sense of security, and suggests people take professional advice before replying to HMRC, as "replying in the wrong way could cause a lot of time consuming headaches later on".
The group points out that contractors are not legally obliged to meet a tax office in person - even for an informal meeting. PCG Plus members can request an adviser to deal with such enquiries from the start, and all contractors should contact their accountant or other professional as a starting point to ensure that they deal with HMRC enquiries in the correct way.
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